Longer Term Trading

Hi Guys,

Just looking to find out some "best practices" for longer term trading ie days, week, months.

Are any of the senior member trading long term ? what stratagies do you use and how do you build in money management ?

Any good teachers in this area ?

Any good info ?

PS: Please guys dont say trade bigger time frames etc, ive been trading 2 years and am looking for a bit more info on this subject.

TY.

Thanks for posting this question boycie.
I'm also looking into trading the said timeframes.

Hopefully we can get informative answers...

boycie,

I have been trading 'long term' systems ever since I started trading FX a couple of years ago. Currently I am in 3 trades which are up in total about 700 pips of open profit. I have been long the JPY since mid October. My average trade length is around 10 days.

I only look at daily charts and it takes me around 20 minutes per day to trade my 3 combined systems on 6 currencies. I have a couple of break-out systems and a mean reversion.

Stop losses are often quite large - sometimes over 200 pips. For example, I went short the GBP on the 8/11 at 1.7392 and my stop loss is still at 1.7518 - still a 126 pip stop loss.

I only risk around 2% per trade so the trade sizes are generally only pretty small compared to the account balance - not much leverage is used.

I have been a few weeks at a time without a trade. I place upto 36 limit/stop entry orders per day but more typically around 12-18. I have 2 accounts, 1 for long and 1 for short because it is possible that one of my systems has me long a currency and another has me short.

The back testing results show an average of 50% returns for the last 3 years (and solid returns for the 8 years previous) and this year it is up around 10% having had a very long drawdown (the latest strength in the USD has pulled it out of drawdown). It is still trading within its historical limits (except for the drawdown length) so I am still pretty comfortable trading it.

Simon

Thanks for the info DrRock..
Actually this is the kind of system I would like to trade..

Mind if I ask how you built your system?
Or did you customize an already existing system?

I have been a few weeks at a time without a trade. I place upto 36 limit/stop entry orders per day but more typically around 12-18. I have 2 accounts, 1 for long and 1 for short because it is possible that one of my systems has me long a currency and another has me short.

The back testing results show an average of 50% returns for the last 3 years (and solid returns for the 8 years previous) and this year it is up around 10% having had a very long drawdown (the latest strength in the USD has pulled it out of drawdown). It is still trading within its historical limits (except for the drawdown length) so I am still pretty comfortable trading it.

Simon[/quote]

Thanks for the geniuine reply Simon. maybe you could explain the above quote a bit better (36 entry/limit order a day ) maybe I am missing something.... ?


The reason I posted this tread was because the last month of my trading has been very successful and its all because of longer term trades.
I have 1 system that is working very well on cable, I call it " Doc Sterling "
it risks 1 % per trade and has gained over 10 % so far over the past couple of weeks. No doubt the rally down in the USD has helped.

Iam trying to get more on the economics of a country ie rates etc and blend it with technicalls to establish a longer term trade ( the entry is not a problem).

So If anybody who trades like this is interested is sharing ideas, please PM me.

Many Thanks.

boycie,

One of the systems is a mean reversion system - if the price moves too far above the mean then you go short with the intention of the price revert back to the mean. So, everyday I place a limit order above the mean for each of the currencies and one below. Most of the time these orders are not hit. I also place stop and limit entry orders for the other systems when they give me the appropriate signals. I trade a purely 100% mechanical system. If I have to make decision about which direction a currency is heading, I will get it wrong.

Simon

Hi Doc,

Your posts sound like DrForex' system as described in " Bird Watching in Lion Country". I just finished reading it last night.

Lou

Mean reversion systems are pretty common - there are no doubt hundreds of variations.

Simon

Hey Lou!,

How did you find the book??.... [Bird Watching in Lion Country].... I got a marketing email to purchase it - I was wondering if it lived up to the raves & testimonies...

Thanks, PipBull.

On what time frame?

long term trading is the best . there's nothing better than having the wind blowing behind your back.trend comes from the high tfs so concentrate on high tfs